In case you missed it yesterday, Lionel was given full approval by Judge Lifland to proceed with their plan to exit bankruptcy. All Lionel creditors will be paid 100 cents on the dollar, including major creditors MTH (per their settlement) and Sanda Kan.
Exit funding is provided by Guggenheim and Train Aqcuisition, LLC who is managing the estate of the late Martin Davis.
With funding obtained and now the courts approval, Lionel should be out of bankruptcy within a month at the latest.
(Thanks to my York Compadre Erol Gurcan for the scoop!)
I’m glad that this whole deal is finished but I am worried that Neil Young has gotten the short end. From what I hear his 20% has been dissolved and his future with the company is up in the air.
I’m glad this is almost over with. It was my understanding that Neil Young & Jerry Calabrese were interested in Buying Lionel after the Bankruptcy & Lawsuit were taken care of. I wonder if this has changed due to the economy or a different set of Circumstances? Take Care.
I don’t know if there is any reason to worry. First off, IF his ownership was dissolved, it won’t affect Mr. Young financially, given his overall wealth. I have not seen anything to indicated that he was bought out. Second, my understanding is that he is the predominant owner of the company that designed Legacy and will be creating additional command control products for Lionel going forward. As a result, I have no doubt that he will be actively involved, one way or another.
EDIT- I just read the AP article that indicates that Neil Young’s ownership in the company was wiped out by the reorganization. However, Jerry Calabrese was quoted as saying Mr. Young will have an opportunity to be part of the new company, if he wants to. It will be interesting to see how this shakes out.
Can someone provide a link to this? The last I heard Lionel and Young were buying out Kovach for his 50% stake in the company that helped develop Legacy… now Young has no interests in Lionel? I can’t believe Lionel would do that… Lionel has bought out TAS and ERR, which pulls the plug on the two largest distributors of add-on TMCC boards, so what happens now???
For the sake of accuracy the Lionel that went into Bankruptcy is not the same company that came out. Guggenheim Funding owns 48.6 % of the New Lionel and has control over the management alloted 15%. Guggenheim has placed 3 of the 5 directors. The original owners hold 28.6 and Jerry Calabrese owns around 7 to 8 %
Some how Neil Young has lost his interest in Lionel… I’m not quite sure what those details are. However a very foolish statement was made that losing his 20% wouldn’t matter because he’s rich… That is nonsense… Calabrese kept repeating all through these proceedings that Lionel’s estimated worth was $100 Million… That was an optimistic estimate but losing $20 Million dollars is not a happy time for anybody.
Eventually the real story of what went on will come out, along with a whole trainload of speculation and false rumor.
All very true. Just like the Lionel Manufacturing Company was not that same company as The Lionel Corporation, and The Lionel Corporation under JLC was not the same as The Lionel Corporation under Lawrence Cowen, and The Lionel Corporation under Roy Cohn was not the same as under Lawrence Cowen, and The Lionel Toy Corporation under Thomas Wolfe was not the same as The Lionel Corporation under Roy Cohn, and The Lionel Toy Corporation under Ronald Saypol was not the same Lionel Toy Corporation as under Wolfe, and Lionel/MPC was not the same Lionel as under Ronald Saypol, and Lionel/Fundimensions was not the same as Lionel/MPC, and Lionel/Fundimensions was not the same as Lionel/Kenner-Parker, and Lionel Kenner-Parker was not the same as Lionel Trains, Inc. under Richard Kughn, and Lionel Trains Inc. under Richard Kughn was not the same as Lionel, LLC under Gary Moreau, and Lionel, LLC under Gary Moreau was not the same as Lionel, LLC under… well… you get the idea.
Bottom line is, since 1900 there has been a Lionel. And with the exception of 1942-1944, and 1967 Lionel has sold trains. And Lionel will continue to do so with a brain-trust of the best engineers and marketing people in the industry.
Thanks Bob. That was a good read. Sounds like NY wasn’t involved in the negotiations, but hasn’t been completely written out of Lionel’s operations. This could get interesting…